Canada has fallen out of the top three most desired destinations for global information technology (IT) talent, according to a new study by Boston Consulting Group (BCG).

While the results were dramatic, for Canada, which fell to seventh in the world, the decline is even more precipitous.

“Canada specifically recorded one of the steepest declines in highly skilled talent inflows of any major destination. With that, Canada has now exited the top three destinations for highly skilled talent globally,” Johan Harnoss, partner and associate director, innovation people chair at the BCG Henderson Institute said to PeopleNX in an email exchange.

“What the data tells us is that Canada’s position as a talent magnet is under real pressure, and the window to act is now.”

221 million workers tracked

The study, entitled BCG Top Talent Tracker Q2 2026, was co-authored by Harnoss and five others at Boston-based consultancy BCG. It looked at real-time mobility data from 221 million professionals, who hold at least a bachelor’s degree, across more than 200 destinations.

It followed the job movement of three types of highly skilled IT professionals: STEM (science, technology, engineering, mathematics), AI (artificial intelligence), and researchers with doctoral degrees.

“The goal is to give business leaders and policymakers a real-time picture of where talent is flowing and why; understanding which countries are gaining ground, which are losing it, and what that means for economic competitiveness and innovation,” Harnoss said.

“This edition covers movement through the end of 2025, and the results were striking: after years of steady expansion in global mobility, we saw a sharp contraction across all categories.”

The research showed global border-crossing relocations dropped from 3.7 million professionals to 3.3 million in 2025, which represented an 11.6-per-cent decline. This resulted in around 430,000 fewer of these workers changed positions in 2025, the survey found.

No single reason for decline

While HR and C-suite professionals need to pay attention, according to Harnoss, the reasons for lowered talent movement are complex. “The data points to a broad-based cooling rather than a single driver.”

And the drop was apparent across all categories tracked.

“Researchers and scientists (those with doctoral degrees) saw the steepest decline of any category, falling 19 per cent globally. The fact that this group pulled back the most sharply points to a cooling at the very top end of global talent flows, and the different funding and immigration environment many universities find themselves in. AI talent fell 12 per cent globally, and STEM fell 13 per cent,” Harnoss said.

For Canada, the sharp drop suggests “the challenge is structural rather than a one-time anomaly,” he said.

“Canada lost 2.1 percentage points of highly skilled market share; 2.6 in STEM, and 2.0 in AI.”

Corporate leaders need to understand that while workers remain looking for a change, Canada needs to work on attracting more skilled talent.

“Canada is losing ground both in absolute numbers and relative to competitors who are gaining,” Harnoss said. “This makes clear that Canada’s challenge is primarily on the attraction side: fewer highly skilled workers are choosing Canada as a destination.”

The demand for AI workers remains “intense,” he said.

"Strong base" for Canada to grow talent base

But the results are not all bad news, according to Harnoss, and Canada is well-positioned to build more skill into the overall workforce.

“For Canada, upskilling is particularly important because it builds from a strong base. Canada has a well-educated workforce and world-class post-secondary institutions. The opportunity is to accelerate the translation of that foundation into applied AI and STEM capabilities at scale.”

Getting the workforce up to speed is key for future economic growth. “Upskilling reaches people across industries, regions and income levels, which matters for equitable economic participation and for Canada’s long-term productivity. Thoughtful immigration policy and domestic upskilling go hand in hand.”

And while the path is clear, the change will not happen overnight, he cautioned.

Benefits of better AI integration

So what can corporate leaders take from these results? Advancing automation in the workforce might be one solution, Harnoss said, but there are some caveats to be aware of.

“The key is designing automation adoption so that it complements human capability rather than simply substituting for it. That’s where the productivity gains are most durable. Canada has strong elements in place — including a sophisticated private sector — and research institutions doing leading AI work, but the rate of adoption across the broader economy needs to accelerate to remain competitive.”

When deciding on what goes into an effective talent strategy, there needs to be buy-in from the top of a company in order to work, and Canada has the right mix in order to benefit.

“That business case needs to reach the full C-suite — not just HR — because the cultural change required to hire and retain globally runs deeper than any single function can drive. Canada has a window of opportunity to position itself as an attractive R&D, product or software hub to serve the Americas and Europe,” Harnoss said.

Those firms that get the talent mix right will see tangible benefits, he said.

“The payoff is measurable: BCG’s analysis of the top 1,000 public companies shows firms that attract more global talent into leadership create an additional percentage point of shareholder value per year.”

While leaders need to lead the effort, there is an important part for people professionals too.

“HR has an essential role to play in several specific areas: designing the end-to-end process for global talent acquisition, building the internal infrastructure for relocation and onboarding, and creating the conditions for internationally-recruited talent to succeed and stay,” Harnoss said.

“The companies getting this right are those where HR is a strategic partner in decisions about where the business is going and what talent it needs to get there, rather than a function that responds after those decisions have been made.”